Gross profit was $18.6 million (57% of total revenue) compared to $18.3 million (45% of total revenue);

Recurring revenue was 67% of revenue, compared to 63%;

Incurred restructuring costs of $14.3 million;

Net loss was $26.7 million, or $0.25 loss per share, compared to a net loss of $12.3 million, or $0.11 loss per share;

Total cash of $49.0 million and cash from operations was $1.0 million; and

Order backlog of $151.2 million at June 30, 2017.

CEO Commentary

“During the quarter we continued to make progress with our Strategic Plan, which is aimed at creating a more efficient, more profitable company with market leading products,” said Danielle Royston, CEO of Redknee Solutions. “In Q3, we improved gross profit, strengthened our recurring revenue stream, generated positive cash flow from operations and worked to deliver Customer Success to a number of customers around the world. We anticipate seeing further momentum with the completion of our rights offering, which is expected to generate gross proceeds of US$54 million. Proceeds from the Rights Offering will be used to fund our restructuring plan.”

Fiscal Q3 2017 Operational Highlights

Smart Communications (“Smart”) awarded Redknee a services and support contract for Redknee Unified. With Redknee Unified, Smart can benefit from improved time to market by adding tool-based testing for production configuration and real-time configuration changes.

A large Tier 1 telecommunications operator in Europe will make a multi-million dollar investment in Redknee Unified. This investment allows Redknee to further enhance its existing service creation platform to provide NextGen capability.

Redknee announced it had entered into a Standby Purchase Agreement with Wave Systems Corp. (“Wave”), an affiliate of ESW Capital, LLC (“ESW”) in connection with the Company’s US$54 million Rights Offering that is fully backstopped by Wave. Redknee will use proceeds of the Rights Offering to fund a restructuring of the business.

Subject to the closing of the Rights Offering, Redknee announced it will enter into a service agreement with Crossover Markets, Inc. (“Crossover”) and a technology services agreement with DevFactory FZ-LLC (“DevFactory”) as such the Company has extended the previously announced interim Service Agreements with both.

Fiscal Q3 2017 Financial Results

Revenue was $32.6 million compared to $40.5 million in the same year-ago quarter. Recurring revenue was 67% of total revenue, compared to 63% in the same year-ago quarter.

Order backlog decreased by 16% to $151.2 million compared to $180.7 million in fiscal 2016.

Gross margin was $18.6 million, or 57% of total revenue, compared to $18.3 million, or 45% of total revenue, in the same year-ago quarter.

Net loss was $26.7 million (includes $14.3 million of restructuring costs) or $0.25 loss per basic and diluted share, compared to a net loss of $12.3 million or $0.11 loss per basic and diluted share, in the same year-ago quarter.

Total cash at June 30, 2017 was $49.0 million. Cash from operations was $1.0 million (included $6.0 million of restructuring payments).

We continue to evaluate the forward $120 million revenue base, and there is potential risk with our customer relationships through this long turnaround process. We believe the restructuring plan is sufficient in a worst case scenario of up to a 25% loss from that revenue base. We also believe that the funding from the Rights Offering remains sufficient to complete the restructuring and commence the Strategic Plan.

Please refer to the section regarding Forward-Looking Statements below which form an integral part of this release. These results, along with the annual audited consolidated financial statements and the Company’s MD&A, are available on the Company’s website at www.redknee.com and on SEDAR at www.sedar.com.

Rights Offering Update

Subsequent to quarter-end the previously announced Rights Offering was approved by 92.58% of the 55,727,138 votes cast by holders of the Company’s Subordinate Voting Shares present in person or represented by proxy at the special meeting of shareholders held on July 25, 2017. With the completion of the shareholder approval requirement, Redknee has commenced the launch of the Rights Offering. Net proceeds from the Rights Offering will be utilized to further our initiative to restructure the Company to position it for growth and profitability.

Further details on the Rights Offering, including eligibility requirements for shareholders to participate and the procedures to be followed by shareholders in order to subscribe for Rights, are included in a Rights Offering circular (the “Rights Offering Circular”) and Rights Offering notice (the “Rights Offering Notice”) which were filed with securities regulatory authorities in each province and territory of Canada on July 26, 2017. A copy of the Rights Offering Circular and Rights Offering Notice is available on SEDAR at www.sedar.com.

Conference Call

The Company will host a conference call tomorrow (August 10, 2017) to discuss these results. CEO Danielle Royston and CFO David Charron will host the presentation starting at 8:30 a.m. Eastern time. A question and answer session will follow management’s presentation.

Redknee monetizes today’s digital world for communications service providers. Our market-leading portfolio of monetization and subscriber management solutions includes real-time billing, charging, policy and customer care modules and is available on premise, cloud-based, or as Software-as-a-Service. With a central focus on driving customer success, Redknee’s products power growth and innovation for operators globally. Established in 1999, Redknee Solutions Inc.(TSX: RKN) can be found on the Toronto Stock Exchange. For more information about Redknee, please go to www.redknee.com.

Non-IFRS Measures

“Recurring revenue,” which is not a financial measure calculated and presented in accordance with IFRS, and should not be considered in isolation or as a substitute to revenue. Recurring revenue includes revenue from support and maintenance agreements, long term service agreements, and term-based product licenses and software subscription.

“Order backlog” relates to contractual commitments as at period end, pending to be delivered and will be recognized as revenue in future periods. Order backlog is not a financial measure calculated and presented in accordance with IFRS and should not be considered in isolation or as a substitute to revenue.

Other companies (including competitors) may define recurring revenue, and order backlog differently. The Company presents recurring revenue and order backlog because management believes these to be important supplemental measures of performance that are commonly used by securities analysts, investors and other interested parties in the evaluation of companies in Redknee’s industry. Management uses this information internally for forecasting and budgeting. It may not be indicative of the historical operating results of Redknee nor is it intended to be predictive of potential future results.

Forward-Looking Statements

Certain statements in this document may constitute “forward-looking” statements which involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this document, such statements use such words as “may,” “will,” “expect,” “continue,” “believe,” “plan,” “intend,” “would,” “could,” “should,” “anticipate” and other similar terminology. Forward-looking statements are provided for the purpose of providing information about management’s current expectations and plans relating to the future. Persons reading this news release are cautioned that such information may not be appropriate for other purposes. Such forward-looking statements include statements respecting order backlog contributing to increased revenue visibility for the Fiscal 2017; the impact of the challenging macro environment on the Company’s revenue; our restructuring initiatives and ongoing cost management efforts are expected to result in significantly improved profitability next year; and financial guidance for Fiscal 2017; as well as statements regarding Redknee’s future plans, objectives or performance for the current period and subsequent periods and regarding the markets for our products. These statements reflect current assumptions and expectations regarding future events and operating performance and speak only as of the date of this document. Such forward-looking statements involve known and unknown risks, uncertainties and other factors and assumptions that may cause the actual results, performance or achievements to differ materially. Such factors include, but are not limited to, assumptions respecting : (i) the conversion of sales pipeline into orders and orders into revenue based on the extent and timing of historical conversion; (ii) the anticipated mix of the sale of products and services of the Company and associated margin being consistent with that realized in the past; (iii) the ability of Redknee to bring new products and services to market and to increase sales; (iv) the strength of the Company’s product development pipeline; (v) the estimated size and growth prospects of the markets Redknee seeks to address; (vi) the Company’s competitive position in those markets and its ability to take advantage of future opportunities in those markets; (vii) the benefits of the Company’s products and services to be realized by its customers; (viii) the demand for the Company’s products and services and the extent of deployment of the Company’s products and services; (ix) the Company’s financial condition and capital requirements; * the stability of general economic and market conditions; (xi) currency exchange rates and interest rates; (xii) capital markets continuing to provide the Company with access to capital. The risks and uncertainties that may affect forward-looking statements include, but are not limited to: the failure of demand for Redknee’s products to develop as anticipated, the failure to obtain customer orders or meet customer requirements, the inability of Redknee’s products to perform as expected, the inability of Redknee to achieve anticipated cost savings in the time frames and to the extent anticipated, unanticipated negative impacts on customer service or product development as a result of costs savings implemented, a material adverse change in the affairs of Redknee, and the factors discussed under the “Risk Factors” section of Redknee’s most recently filed AIF which is available on SEDAR at www.sedar.com and on Redknee’s web-site at www.redknee.com. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Redknee does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.